Hi, Shrewd!        Login  
Shrewd'm.com 
A merry & shrewd investing community
 Best Of Macro | Best Of | Favourites & Replies | All Boards | Post of the Week!
Search Macro
Shrewd'm.com Merry shrewd investors
Best Of Macro | Best Of | Favourites & Replies | All Boards | Post of the Week!
Search Macro

Personal Finance Topics / Macroeconomic Trends and Risks❤
Unthreaded | Threaded | Whole Thread (3) |
Post New
Author: WendyBG ✸  😊 😞
Number: of 2033 
Subject: Perpetual futures = "perps"
Date: 09/24/2025 12:15 PM
Post Reply | Report Post | Recommend It!
No. of Recommendations: 8
I'm always interested to see a new investing term.

https://www.wsj.com/finance/currencies/bitcoin-per...


Get Rich or Get Wiped Out: Bitcoin’s Hottest New Trade
Perpetual futures offer traders extreme leverage to bet on cryptocurrencies

By Gunjan Banerji, The Wall Street Journal

Traders seeking rapid returns have made a speculative bitcoin play one of the most popular crypto bets globally: so-called perpetual futures. These potentially offer returns of 10, 20 or even 100 times an initial investment — or huge losses that could leave a trader with nothing...

Known as perps, the contracts give traders access to extreme leverage ...Their emergence is a sign that financial markets, which have steadily grown riskier since 2020, will likely keep growing more speculative. ...

Perps made up around 68% of bitcoin trading volume in 2025, according to Adam Morgan McCarthy, head of research at analytics firm Kaiko. Here’s how they work:

The instruments are derivatives, but unlike traditional contracts lack expiration dates or so-called “strike prices,” at which contracts can be exercised. Gains or losses are based on bitcoin’s moves; the trades are akin to options that automatically roll further and further out in time....the platform isn’t limiting itself to leverage of 10 times the initial investment. ...

When perps are trading at higher levels than the spot price, those holding long positions, meaning they are bullish on bitcoin, regularly pay something called a funding rate to the counterparty on the derivative. This is designed to keep the prices of futures and underlying bitcoin prices linked. These can eat away at profits, depending on how high they are. Those who are short the contracts can receive the funding rate.

The bets can be big moneymakers for those hosting the trades.... [end quote]

No surprise that such leveraged gambling has inflated the price of bitcoin.

https://www.tradingview.com/symbols/BTCUSD/?timefr...

This is a pure speculative bubble. The use of "perps" that encourage leverage but also have a "funding rate" - skim - makes them even more dangerous to long gamblers.

Needless to say, I wouldn't touch this with a 10 foot pole.
Wendy



Print the post


Author: Timer321   😊 😞
Number: of 2033 
Subject: Re: Perpetual futures = "perps"
Date: 09/24/2025 1:15 PM
Post Reply | Report Post | Recommend It!
No. of Recommendations: 0
Even if I had an 11-foot pole, no way.
Print the post


Author: jerryab   😊 😞
Number: of 2033 
Subject: Re: Perpetual futures = "perps"
Date: 09/24/2025 2:54 PM
Post Reply | Report Post | Recommend It!
No. of Recommendations: 0
Do it the way Spankee does:

Use somebody else's money.
Print the post


Post New
Unthreaded | Threaded | Whole Thread (3) |


Announcements
Macroeconomic Trends and Risks FAQ
Contact Shrewd'm
Contact the developer of these message boards.

Ticker or Board Name Author

Best Of Macro | Best Of | Favourites & Replies | All Boards | Followed Shrewds